With all of the talk of taxes . . .

[BanginJimmy]

Lets see what you tax rate you REALLY pay.

Tax rates are here.
http://www.forbes.com/sites/moneybuilder/2011/09/30/2012-federal-income-tax-brackets-irs-tax-rates/

Definitions:

Gross income: Sum total of all forms in income.
Taxable income: Sum total of all income minus deductions
Marginal tax rate: Tax rate you pay on taxable income.
Effective tax rate: Tax rate you pay on gross income.


Here is mine:
I am married with no kids. I have a mortgage and I do itemize my deductions.

Gross income:111,177
Taxable income:67,193
Taxes owed: 9226
Effective tax rate: 8.29%
Marginal tax rate: 13.73%



If you dont feel like throwing out your income thats fine. Throw out your effective and marginal tax rates though. Lets see how many people actually do pay a higher rate than Mitt Romney's 14%.

[bu villain]

My effective tax rate was closer to 10%. By the standard definition, my marginal tax rate is 15%, not sure what it would be by your definiton since I don't have my return in front of me. While anecdotal evidence is interesting, the averages are more useful. These are the most recent numbers I could find on the CBO site:

http://www.cbo.gov/sites/default/files/cbofiles/attachments/43373-AverageTaxRates_screen.pdf

Figure 1 on Page 29 is for the effective tax rate. Mitt pays less than the average person in the fourth quintile although he is obviously near the top of the fifth quintile. The average for the fifth quintile is about 24%. Personally, I'm not that worried about Mitt's tax returns.

[BanginJimmy]

By the standard definition, my marginal tax rate is 15%, not sure what it would be by your definiton since I don't have my return in front of me.

Where am I wrong on the standard definition? Your marginal rate is you tax bill divided by your taxable income. Your effective rate is tax bill divided by your adjusted gross.





While anecdotal evidence is interesting, the averages are more useful. These are the most recent numbers I could find on the CBO site:

http://www.cbo.gov/sites/default/files/cbofiles/attachments/43373-AverageTaxRates_screen.pdf

Figure 1 on Page 29 is for the effective tax rate. Mitt pays less than the average person in the fourth quintile although he is obviously near the top of the fifth quintile. The average for the fifth quintile is about 24%.

The problem with that chart is it doesnt break down by income type. The top quintile is always going to be more affected by capital gains and carried interest than the other quintiles. I actually think this drives down their average rate quite a bit.




Personally, I'm not that worried about Mitt's tax returns.

I wish more people on the left would take this stance. It is a non issue.

[.blank cd]

I wish more people on the left would take this stance. It is a non issue.Its only an issue because the right made it one. They pressured the president to release documents on a non issue, now there's some pushback when the left wants more relevant documents? I also could care less about Mitts tax returns, I've heard enough to know how little he pays. I'm 100% sure the proper authorities have vetted each candidate for their qualifications LONG before being sworn in.

[ahabion]

For my 2011:

Married, 3 kids, mortgage and itemized deductions;

Gross: 97,459
Taxable income:51,911
Taxes owed: 7103
Effective tax rate: 7.85%
Marginal tax rate: 13.68%

[bu villain]

Where am I wrong on the standard definition? Your marginal rate is you tax bill divided by your taxable income. Your effective rate is tax bill divided by your adjusted gross.

The standard definition I usually see is that marginal rate is the amount you would pay on your next/last dollar of income. It has nothing to do with your gross income, only your taxable income.

Marginal Tax Rates: The Concise Encyclopedia of Economics | Library of Economics and Liberty (http://www.econlib.org/library/Enc/MarginalTaxRates.html)
Marginal Tax Rate Definition | Investopedia (http://www.investopedia.com/terms/m/marginaltaxrate.asp)



The problem with that chart is it doesnt break down by income type. The top quintile is always going to be more affected by capital gains and carried interest than the other quintiles. I actually think this drives down their average rate quite a bit.


Your right that capital gains will bring down the average. I don't know why that's a problem though. I thought the effective tax rate (which includes all kinds of income) is what we were interested in here.



I wish more people on the left would take this stance. It is a non issue.

I agree but I feel that way constantly about many of the issues that make it in the main stream debates.